About to start DMP

gorskiii

fatbelly said:

gorskiii said:

Sorry for another question. I’ve set up a new bank account due to one of my debts being owed to who I currently bank with. My wage will now go into my new account along with my various direct debits. 

The question I have is that my mortgage is with the bank as well. I take it I don’t have to change my mortgage as well? I can keep the same mortgage provider and carry on making my monthly payments.

No that's fine. The mortgage is just another debt, but a secured one and so high priority

Cheers you’ve helped put my mind at rest.

Rob5342

I was a bit apprehensive about starting a DMP and had a few concerns, but it all went very smoothly and I now wish I'd just done it sooner. I was concerned about how I'd manage on a reduced budget but I actually felt far more relaxed than I used to and it felt like I was making far better use of my money. I'd forego a lot of  luxuries like takeaways, eating out etc, but when I needed new shoes etc I had the money for a decent pair.

Floss

Rob5342 said:

I was a bit apprehensive about starting a DMP and had a few concerns, but it all went very smoothly and I now wish I'd just done it sooner. I was concerned about how I'd manage on a reduced budget but I actually felt far more relaxed than I used to and it felt like I was making far better use of my money. I'd forego a lot of  luxuries like takeaways, eating out etc, but when I needed new shoes etc I had the money for a decent pair.

I agree, there's no fretting about how to pay the c/c bills or for an unexpected car repair.

gorskiii

Rob5342 said:

I was a bit apprehensive about starting a DMP and had a few concerns, but it all went very smoothly and I now wish I'd just done it sooner. I was concerned about how I'd manage on a reduced budget but I actually felt far more relaxed than I used to and it felt like I was making far better use of my money. I'd forego a lot of  luxuries like takeaways, eating out etc, but when I needed new shoes etc I had the money for a decent pair.

Ditto. Wish I’d started down this road sooner. Hopefully it’ll teach me to be more sensible with money going forward and budget better. 

gorskiii

When you’ve spoken to a company re the debt you owe them what happens? Obviously you inform them how much you can pay each month. I’m just wondering as one of them is a credit card debt. Does the interest get frozen on it and the monthly payment starts to chip away at it?

Rob5342

gorskiii said:

When you’ve spoken to a company re the debt you owe them what happens? Obviously you inform them how much you can pay each month. I’m just wondering as one of them is a credit card debt. Does the interest get frozen on it and the monthly payment starts to chip away at it?

If it has defaulted then the interest will be frozen and your monthly payments will bring the balance down. Once defaulted debts often get sold to debt collection agencies or passed to debt collectors to handle the payments. That can sound a bit scary when you first hear the name but all that happens is you pay them instead.

gorskiii

Rob5342 said:

gorskiii said:

When you’ve spoken to a company re the debt you owe them what happens? Obviously you inform them how much you can pay each month. I’m just wondering as one of them is a credit card debt. Does the interest get frozen on it and the monthly payment starts to chip away at it?

If it has defaulted then the interest will be frozen and your monthly payments will bring the balance down. Once defaulted debts often get sold to debt collection agencies or passed to debt collectors to handle the payments. That can sound a bit scary when you first hear the name but all that happens is you pay them instead.

Many thanks for this info. Before then (going into default) it’s a case of don’t pay anything each money. In the meantime interest will get added and also there could be a possibility of going over the agreed limit(?).

Rob5342

gorskiii said:

Rob5342 said:

gorskiii said:

When you’ve spoken to a company re the debt you owe them what happens? Obviously you inform them how much you can pay each month. I’m just wondering as one of them is a credit card debt. Does the interest get frozen on it and the monthly payment starts to chip away at it?

If it has defaulted then the interest will be frozen and your monthly payments will bring the balance down. Once defaulted debts often get sold to debt collection agencies or passed to debt collectors to handle the payments. That can sound a bit scary when you first hear the name but all that happens is you pay them instead.

Many thanks for this info. Before then (going into default) it’s a case of don’t pay anything each money. In the meantime interest will get added and also there could be a possibility of going over the agreed limit(?).

Yes that's correct if you are going down the default route. It's a long term strategy, you'll pay more interest now and may have late payment charges added, but long term your credit report will be clean sooner, and the debt is more likely to end up with a DCA who will be more likely to accept a reduced settlement offer.

gorskiii

When you speak to those you owe money to about going into a DMP what do you actually say to them (once cancelled direct debits and gone into arrears)? Advise that you will be paying a reduced amount each month and ask to set up a DD? Try not to give them all of your income/expenditure etc. So as long as they’re getting something each month they in the main they’ll be content (same with the collection agencies if they debt has been sold on)?

stu12345_2

if you use the creditors or the debt collection company's websites you see set up a payment plan with us.they get you to fill in their forms.it asks for your wages benefits pensions assets are you behind in priority debts are you on a payment plan with the priority debts

what do you spend on fuel rent magazines clothes  water MOT Insurance ( each one has  a box to fill in) etc  ( there. will be no box for holidays or savings)  just a box for emergencies.
do you owe any non priority debts .are you behind on them.how much do you pay  and owe them.it then works out your disposal income and creates a pro rata amount they should get based on all your other creditors debts and ask your bank details and what day you want to pay. a direct debit to them


or you can ignore all that and just say what is your sort code and account number  so I can do a standing order ( sometimes it's on the back of the standard monthly statement letters.ways to pay us)and pay you such and such amount based on your own calculation as you will be doing your own self management dmp..if you get those details you just use your debt reference number in the standing order as a reference.

be forceful don't back down into thinking you have to fill out all their forms and go with a DD and what they calculate as your disposable income and a correct pro rata amount to pay. as you can do it all on your own with some effort with your own self managed dmp based on your findings and how much you fancy paying.

the creditors or debt company have designed make contact or pay us in such a way that you must go through their dmp direct debit set up based on all their findings.its a bit sneaky imo the way it has been designed